On June 1,2008,Will Oldman,treasurer of A-One Corporation,received an Option to Purchase

question 71

Essay

On June 1,2008,Will Oldman,treasurer of A-One Corporation,received an option to purchase 2,000 shares of A-One $5 par value common stock for $20 per share any time during 2009 or 2010.Oldman exercised his option on May 14,2009.The market price of the stock was $20 per share on June 1,2008,and $25 per share on May 14,2009.Provide the entry in journal form to record the exercise of the option on A-One's books.Show computations.(Omit explanation.)

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Definitions:

Drawee

The party, typically a bank or financial institution, upon whom a cheque or draft is drawn and is responsible for paying the specified amount to the holder or bearer of the instrument.

Payees

Individuals or entities to whom money is to be paid or is owed.

Discrepancy

A lack of compatibility or similarity between two or more facts, figures, or findings leading to a deviation from what is expected or agreed upon.

Numeric Field

A field in databases or software applications designated for numerical data.